PRESIDENT OBAMA: So I usually don't start these off with a long statement. Obviously our overarching focus right now is the economy. I am very mindful of the hardships that are taking place all throughout the country -- families who are losing their homes, losing their jobs, losing their health care. I get a sampling of the letters that are sent to me every day, and some of the stories are just heartbreaking.

And everything that we're doing is focused on not only pulling this economy out of what is the worst recession since the Great Depression, but also looking at ways that we can set a foundation for long-term economic growth. You know, the days of growing the economy through an overheated housing market or through people running up exorbitant credit card bills is over.

We've got to put our growth model on a different footing, and that means that we've got to deal with our health care system and reduce costs for families, businesses and governments. It means that we have to think through our energy policy so that we're not so badly dependent on foreign oil. It means we've got to improve our education system so that our young people are equipped with the skills and knowledge that they're going to need to get jobs in the future.

And so the Recovery and Reinvestment Act that we passed reflected those priorities. You know, we had tax cuts to the middle class, but also investments on health information technologies and doubling renewable energy; a enormous effort to jumpstart school reform at the same time as we are providing some much needed relief to states so that they wouldn't be laying off teachers and firefighters and cops; and that we could rebuild our infrastructure.

The budget that I've now prepared and will be going before Congress and debated over the next month reflects many of those common priorities, and we're going to be building off of the progress that we made in the first 50 days. Now is the time I think for us to deal with health care in a serious way and start reducing costs as well as expand coverage. We're going to have to keep pushing on the energy front not just with things like the smart grid, but also figuring out how do we move to more renewable energies.

And on education, how do we build on the reforms that we talked about during the campaign and that are funded at least temporarily through the stimulus package. And I gave a major speech on education priorities yesterday.

I think that there's going to be some battles surrounding this budget. There always are. Obviously at the same time as we're moving this budget forward, I'm spending probably the majority of my time stabilizing the financial system. There are some who've argued that we can't do all of these things at once and that we should instead just focus on Wall Street and banking, and not deal with the enormous pressures that families are feeling on a day-to-day basis. I think that would be a mistake. I think that extraordinary times call for extraordinary measures.

And so even as we're working on financial stabilization, reregulating Wall Street, we're going to keep on pressing to get the investments that will ultimately lead to long-term economic growth.

So -- I also have Iraq and Afghanistan to deal with. (Laughter.) But I figured that would at least get us started. So why don't we just go around the room. I'll try to make sure that everybody gets a question. Since we've got somewhat limited time, I'll try to keep my answers short, if you guys can keep your questions short.

All right. Michael.

Q Thank you, Mr. President, for having us today. Since we're only going to get maybe one shot, I want to ask you a question that's of great concern to the people of my state of New Mexico. And as you're fully aware, Mexico is besieged by drug-related violence. In my state there's a very real concern that this violence will spill over to the border; in a few cases, it already has. What specifically does the administration plan to do to help contain this violence? And on a related note, if there's anything you could say about immigration reform and when we might see some sort of action on that front.

PRESIDENT OBAMA: Well, as you know, the first meeting with a foreign leader that I had after my election was with President Calderón in Mexico, who I believe is really working hard and taking some extraordinary risks under extraordinary pressure to deal with the drug cartels and the corresponding violence that's erupted along the borders.

So this past week Admiral Mullen, Chairman of the Joint Chiefs of Staff, visited with his counterparts in Mexico. Janet Napolitano, our director of Homeland Security, a border state governor, has been convening meetings with all the relevant agencies and consulted with the governors down there.

We expect to have a full -- a fully -- or a comprehensive approach to dealing with these issues of border security that will involve supporting Calderón and his efforts in a partnership; also making sure that we are dealing with the flow of drug money and the guns south, because it's really a two-way situation there. The drugs are coming north; we're sending funds and guns south -- and as a consequence, these cartels have gained extraordinary power.

And so, our expectation is to have a comprehensive policy in place in the next few months.

With respect to immigration reform, to some degree the collapse of housing construction in the country has slowed the flow of illegal immigrants coming into the country, but it remains a serious concern. And our approach is to do some things administratively to strengthen border security; to fix the legal immigration system, because a lot of the pressure -- or a lot of the impetus towards illegal immigration involves a broken legal system -- people want to reunify families and they don't want to wait 10 years.

I think we can make some progress on that front, and we've started to talk to all the parties involved and both parties here in Washington about the prospects of taking legislative steps. But obviously we've got a lot on our plate right now. And so what we can do administratively, that's where we're going to start.

Q Thank you very much.

Q Mr. President, the numbers that came out today show that Indiana lost 59,400 manufacturing jobs last year. You've been in Elkhart, you've seen the ravage there.

Aside from a bailout to the auto industry and the RV industry, are there policies that the state of Indiana ought to be embracing to strengthen its economy, or is the manufacturing sector in Indiana and elsewhere doomed?

PRESIDENT OBAMA: Well, look, obviously I come from a neighboring state, and if you think about northwest Indiana, it's as much a part of the Chicago regional economy as Indiana's. And so I'm very mindful of what's been happening. But I think that also points to where the opportunities are. Both Chicago and Indianapolis have done relatively well, those regions, because of a diversified economy.

So what started off as hardcore traditional manufacturing towns made the transition to other areas -- building on the universities, setting up research parks, thinking about innovative sectors in bio- medicine or in energy technologies.

And so part of what I think every state should be doing right now is figuring out, A, how do we invest in our people so that we're attracting world-class businesses who are looking for world-class employees. I think getting K-12 education right, not short-changing higher education -- I think those things are absolutely critical; thinking about where can -- where do strategic infrastructure investments make sense. You know, if you think about the Midwest, one of the problems is, is that -- this is my stenographer. She just wants to make sure that I'm not tripping over myself.

One of the exciting things that we put in our stimulus package, for example, was high-speed rail, and is there an opportunity to connect Chicago, Indianapolis, Detroit, Milwaukee, St. Louis, so that we're linking up some of these major metropolitan hubs in ways that provide us a competitive advantage in the world economy.

I think making sure that we are setting up research facilities or encouraging and attracting researchers, venture capital that spins off new technologies into commercial applications -- some states do that better than others. Obviously Silicon Valley is the best example of it, but Massachusetts, along Route 128, did it very well. There's no reason why working with some of the world-class universities that exist in the heartland in the Midwest that we don't adopt some of those same practices.

So we're going to do everything we can to preserve our manufacturing base. We have to recognize that some of those workers who used to manufacture steel now are going to be manufacturing solar panels. And we've got to make sure that they're equipped to do that. Okay?

Q Thank you, Mr. President. You named a special envoy today to oversee the closure of Guantanamo. I'd like to ask you about that. Among the places being -- possibly being considered as an alternative to those prisons is Fort Leavenworth, Kansas. There's a wall of opposition --

PRESIDENT OBAMA: Where my mother was born, by the way.

Q Exactly. There's a wall of opposition to that -- local officials, people in the area and plus from the congressional delegations of those states. How would you explain the rationale between the possibility -- if a place like Leavenworth would be chosen, the rationale behind that, and reassuring people of their safety and security?

PRESIDENT OBAMA: Well, keep in mind we haven't made any decisions on this. But also recognize that these individuals who have been imprisoned, many of whom are very violent or who have been detained, many of whom are violent and are pledging violence against the United States, once captured are similar to criminals who have engaged in violence of other types. They are a serious risk, but so are many of the people who are currently in prison. And we would not -- we would never put people into a situation that elevated the risks for surrounding communities. And that will obviously be something that we take very seriously as we're making these decisions moving forward.

But we already have experience with terrorists who are in federal prisons. And there's been no indication that the safety and security of prison guards or the surrounding communities have been compromised as a consequence. That doesn't mean that it's not a serious issue. I recognize why people are concerned. We haven't made any firm decisions on this yet. But I have every confidence that we can determine the ultimate fates of those in Guantanamo in a way that's consistent with our values, consistent with our ideals, and that keeps us safe and secure.

Q Thank you, Mr. President.

Q Mr. President, yesterday you called for eliminating restrictions on the number of charter schools while enforcing some vigorous standards. In Ohio, the Governor has called charter schools a destructive influence on public education, a few years ago tried to have a moratorium on new charters, now wants to cut state spending by about 20 percent for charter schools and restrict some other funding. I'm wondering whether you've ever talked with him about this, and is this just a fundamental disagreement between the two of you?

PRESIDENT OBAMA: You know, I haven't had a conversation with Governor Strickland. I know that part of his concern was prompted by some bad experiences with charters in Ohio that weren't up to snuff. And if you looked at my statement yesterday, what I said was not only should we lift the cap on charters, we should also shut down charters that aren't meeting standards. I don't think that's inconsistent with Governor Strickland's position.

My goal here is to create laboratories of innovation so that in the public school system, we are on a race to the top as opposed to stuck in the old ways of doing things. And we've got to -- we've got to do that. In your home town of Cleveland, I don't know off the top of my head what the dropout rate is, but I've got to assume that it's hovering around 50 percent. If you look at the number of children going through the Cleveland public schools who are actually prepared to go to college, it's probably one out of seven or eight or 10. And that's just not acceptable. It's not acceptable for them, it's not acceptable in terms of America's economic future. And so we've got to experiment with ways to provide a better educational experience for our kids, and some charters are doing outstanding jobs.

So, the bottom line is to try to create innovation within the public school system that can potentially be scaled up, but also to make sure that we are maintaining very high standards for any charter school that's created.

Q Well, I have to ask you an ethanol question.

PRESIDENT OBAMA: Go ahead.

Q The biofuels. As you probably know, your Agriculture Secretary is joining the ethanol industry and calling on the EPA to do an immediate increase in the ethanol limit to 12 or 13 percent, in advance of doing a higher 15 or 20 percent. Engine manufacturers, the automakers have been opposed to this. What is your position? Are you going to get involved in this decision by EPA?

PRESIDENT OBAMA: At some point I usually get involved. If it -- somebody explained to me that nothing comes to my desk if it's easy. (Laughter.) It means that somebody else has solved it. And I suspect that this one will be reconciling a lot of different issues.

As you know, I've been a supporter of biofuels. I think it is an important ingredient in our overall energy independence. I've also said -- and I said during the campaign trail in Iowa, in front of farmers -- that it was important for us to transition to the next generation of biofuels, that we've got to do a much better job of developing cellulosic ethanol, that corn-based ethanol, over time, is not going to provide us with the energy-efficient solutions that are needed.

And I want to make sure, though, as somebody who comes from a corn-growing state, that the progress that we've made in building up a biofuels infrastructure and the important income generation that has come from ethanol plants, that that is sustained, that that's maintained.

So our challenge, I think, is to see our current ethanol technology as a bridge to the biofuels technologies of the future. And that's what we want to invest in, and that's what I'll be directing my Department of Agriculture to focus on.

Q Mr. President, you already mentioned the budget fight.

I'd like to talk to you a little bit more about that, the one that's coming up. The budget outline is an extraordinary document in many ways, and encapsulates a large part of the governing agenda that your administration has laid out. It's no surprise the Republicans don't really like it. But the interesting thing is, it may be the centrist Democrats who are the -- this evolving coalition of centrist Democrats and Republicans in the Senate, and to some degree the Blue Dogs in the House, that are the real problem as they begin to look at the budget and find objections. Could you talk a little bit about that, the coming budget fight, but specifically what you can do to make sure that the vision in that document simply isn't dismantled as it goes through the messy budget process?

PRESIDENT OBAMA: Let me sort of provide you an overarching frame, because I think that -- you know, there's -- the way that it has been discussed, I think, in some cases overstates the degree to which there's some massive transformational shift. On the other hand, in some ways it understates, I think, the significant reforms that are embedded in the budget.

So, point number one, this is a pretty honest budget. You've got billions of dollars that we've put into the budget that for the last eight years at least have never been acknowledged as costs. Fixing AMT, which is about $70 billion a year -- that was just off the books. The war in Iraq -- off the books. The way budgeting was done, it presumed that there was never, ever a national emergency arising out of a hurricane, a flood or tornado; that none of them existed.

Now, if we had continued on -- had we applied the same gimmicks and tricks to our budget as folks have been putting up with for the last eight years, including members of Congress, we could make our numbers look really pretty. We thought that that was the wrong approach.

So, number one, we have provided I think a honest document of what the costs of government are right now.

Second point is that on the revenue side, I campaigned during the election and was not shy about it that we needed to restore some balance to our tax code; that over the last decade the average worker has seen no increase in their wages or incomes when you factor in inflation -- just been flat; whereas the top 5 percent, but more particularly the top 1 percent, and even more particularly the top one-tenth of 1 percent, had seen extraordinary gains in their incomes.

And what I said was, is that we needed to return to the tax structure that existed during the '90s under Bill Clinton and let the Bush tax cuts lapse. That's what this budget does.

Now, if you think about it, just to go back to the budget gimmick issue before, since 2001 part of the trick that had been perpetrated on the American people was to say that the Bush tax cuts would lapse in 2010 and that's why this wasn't a huge budget-buster.

So, in effect, all we're doing is actually moving forward with the premise of the budget that the Republicans presented about five, six years in a row, which was that this was supposed to lapse in 2010. For them to suggest now that this is some radical assault on the rich I think just makes no sense whatsoever.

Here's what we do, though -- we say that on health care, energy and education, it's time for us to make investments that had been put off for decades and had made us less competitive. And every dime of increased spending that we include in those areas we offset either with additional revenues or with cuts, and we cut a lot of stuff.

I mean, we're looking at billions of dollars of cuts out of Medicare's Advantage program, where we're subsidizing insurers but not making seniors any healthier. We are making significant cuts in procurement -- $40 billion that we've identified by making sure that we're not engaging in the same no-bid contracting that has been such a problem.

In fact, if you look at the trajectory of our non-defense discretionary spending, which is what usually people think about when they think about whether a budget is loaded up with a bunch of nonessential spending, following our budget we would drive non-defense discretionary spending down to the lowest levels since they started keeping records back in '62 -- much lower as a percentage of GDP than it was under Reagan or under Bush.

So really what the -- what the big arguments are going to be about are, number one, do you believe that now is the time for us to deal with health care in a serious way? And if you're serious about long-term fiscal responsibility and dealing with Medicare and Medicaid, then you can't say we're not going to deal with health care now. That's our biggest problem. If health care continues to go up at 6, 7, 8, 10 percent a year, then we can't solve our budget deficits and we can't solve our national debt.

So I'm happy to have that argument with anybody. I also think that on the energy front, if we aren't willing to start putting a price on carbons that are contributing to climate change but also encourage us to use fossil fuels that we end up importing from other countries, then we can talk all we want about energy independence -- we're not going to get there.

And on education, if we're pricing people out of the college market, if nobody wants to teach because teachers don't get paid much, if we're not investing in early childhood education, if we're not investing in science and technology, then we're going to fall behind.

So whether we're talking about Republicans or my fellow Democrats, my argument is going to be that these are the -- these are the right priorities for America, these are the right priorities for long-term economic growth. Yes, they require some uncomfortable votes. If it was easy, I'm assuming it would have been done 20 years ago or 30 years ago. It's not easy, but it's the right thing to do.

Q Thank you, Mr. President. I wanted to ask you about your Cabinet and your senior staff. By my count, you have about seven folks from the Midwest, six from the West, a crowd from the Northeast, and with maybe the exception of your able-bodied press secretary --

PRESIDENT OBAMA: Gibbs?

Q Mr. Gibbs.

PRESIDENT OBAMA: He's the only Southerner?

Q I think so.

PRESIDENT OBAMA: You guys are feeling neglected?

Q Yes. (Laughter.) So I'm wondering why is that and what you don't like about the South?

PRESIDENT OBAMA: I love the South. (Laughter.)

Q And I'd also ask -- like to ask you about -- I think this is an unrelated question -- the salmonella outbreak and food safety originated in Georgia and what you think needs to be done about that?

PRESIDENT OBAMA: Well, look, the -- I love the South. I've got to admit that we have thought a lot about finding the very best people for the jobs and haven't been thinking with great intensity about regionalism, because partly except for food and sports teams and weather, I mean, we're one country. And I think that people are so mobile these days that -- I tend to think of ourselves as all just Americans.

But if you've got some great Southerners -- (laughter) -- who want to work for us, please let me know, because we're always open. I love the South.

Food safety is a serious concern, and I've directed both FDA -- I've directed both the Department of Agriculture and Health and Human Services to work to come up with a plan so that a lot of these different agencies that have some jurisdiction over food safety are integrated in a much more effective way and things aren't falling through the cracks.

There's a lot of work that needs to be done in working on the front-end with food producers so that there are better warning signals of potential problems than we have right now. And we also need to be able to trace sources of food contamination much more quickly than we're doing right now. And technology can be helpful, but the key is actually reorganizing the agencies that are responsible so that they're working more in concert than they are right now.

Q Thank you, and thanks for doing these. I actually have a follow-up on FDA, and that is, do you still support that agency regulating tobacco, and if so --

PRESIDENT OBAMA: Yes.

Q -- what's the timeline you'd like to see Congress working on that? And is the agency up to the task if we're still having -- just like we saw last month with the peanut butter -- food problems?

PRESIDENT OBAMA: You know, we're probably going to have an announcement on this fairly soon so I don't want to step on my own story, but I do think that the FDA has an important role to play on an issue that obviously has enormous impact on the health of the American people. That's all you're going to get out me there. (Laughter.)

Go ahead.

Q I have a question sort of similar to the Atlanta question. The Voting Rights Act, as you know, does not -- Birmingham --

PRESIDENT OBAMA: I was just about to say, the -- don't I have some Birmingham people in my Cabinet? (Laughter.)

Q Well, Gibbs is from Auburn.

PRESIDENT OBAMA: There you go, it's close. (Laughter.)

Q The Voting Rights Act, as you know, does not apply -- especially section 5 -- does not apply to the entire country. The South is still required to get pre-clearance for election-related changes. There's an argument in Alabama and I think some other Southern states that they've sort of outgrown that; they no longer need that close scrutiny from the Justice Department to make those kinds of sometimes very simply changes. I know in 2006 you supported reauthorization, but do you still think the South needs this close supervision of Justice on -- under section 5?

PRESIDENT OBAMA: Well, I got to be careful here because I'm a law professor so I may get too deep on the weeds on this stuff, get --

Q No, try it. Go for it. (Laughter.)

PRESIDENT OBAMA: But the idea behind section 5 of the Voting Rights Act is that if there are discriminatory barriers to voting, that the Justice Department has some mechanism to actually deal with it; that you don't just leave it up to the states to self-correct, but that you've got some basis for intervention.

The most obvious kinds of violations don't happen very often these days -- the classic being sort of the poll tax or the county clerk who just turns away African American voters. That's not really the key issue in the Voting Rights Act these days.

Typically, the issues that come up now have to do with whether there is a meaningful opportunity to select a candidate of your choice. If you've got a situation in which there is very racially polarized voting and you've got -- you know, 30 percent of the population is Hispanic or African American and the rest is majority white and it's a polarized part of the country and you've got at-large voting systems, well, it's conceivable that on a city council or a county board, you'd never have any African Americans or Hispanics on that board.

So that's what section 5 of the Voting Rights Act does, is to try to pre-clear, see if there are any changes in the voting systems that would prevent people from exercising a meaningful vote.

The key concept I think in judging whether or not a jurisdiction still should be jumping through that hoop is probably the degree to which there are still highly racially polarized voting -- under the parlance, racial black vote. And, you know, there are probably some parts of the south that were under section 5, that if you looked at the data are no longer that polarized. There are other parts that are probably still very polarized.

So I think it's the task of the courts to look -- and Congress, in future reauthorizations -- to look at the evidence and to see is that kind of polarization still taking place. And is that -- you know, it's not enough just to look and see is that one factor out of 10 or 15 factors, is it such a significant factor that, in fact, it's really preventing certain groups from having any representation whatsoever.

So I guess that's all a long way of saying that you really have to look at the data and examine whether or not it still has some applicability.

The only other thing I'd -- the only other point I'd make about this is keep in mind that the pre-clearance is just that -- it requires before you make a change to go before the D.C. circuit or the federal courts and just show that these changes aren't a problem. That's not such a huge hurdle to jump through. So I think it's legitimate to err on the side of caution before you started eliminating that requirement.

Q Thank you.

Q Mr. President, I wanted to follow up on the border question and the violence in Mexico. President Calderón recently decided to send an additional 5,000 of his troops to the border. The Texas governor has asked for a thousand U.S. troops or Border Agents to reinforce the border on our side. What is the tipping point in you mind, where the violence gets so bad that you need to act?

And related to that, you named a new drug czar today. You've taken that position out of the Cabinet. You in the past have talked about decriminalization of marijuana. Are we still engaged in a war on drugs?

PRESIDENT OBAMA: Well, let me first start on the troop issue. We've got a very big border with Mexico. And so I'm not interested in militarizing the border. I am interested in providing the kind of -- in creating the kind of partnership with the Mexican government that ensures the safety of U.S. citizens, the safety of Mexican citizens, and allows for the continued cross-border trade that's so important to the region.

If we're going to examine whether and if National Guard deployments would make sense and in what circumstances they would make sense as part of this overall review of our border situation -- I haven't drawn any conclusions yet. I don't have a particular tipping point in mind. I think it's unacceptable if you've got drug gangs crossing our borders and killing U.S. citizens. I think if one U.S. citizen is killed because of foreign nationals who are engaging in violent crime, that's enough of a concern to do something about it.

With respect to -- what was the second question?

Q If decriminalization of the marijuana laws --

PRESIDENT OBAMA: I think what gave me pause on that question was I think you -- I'm not sure it's accurate to say that I -- well, the implication was somehow that I think we should weaken our drug laws. That's never been my position. I think that what we do have to -- I think the approach that we do need to take is to make sure that we have a both/and approach as opposed to an either/or approach.

I think traditionally the debate is either interdiction, criminalization, longer drugs -- longer prison sentences for not only dealers, but users; that's one approach. And then the other approach would be sort of a public health, decriminalization approach.

My attitude is we do have to treat this as a public health problem and we have to have significant law enforcement. And, you know, if we can reduce demand, obviously that allows us to focus more effectively where interdiction is needed, where we've got to go after serious drug dealers and narcotrafficking.

Right now I think that we're fighting with one hand tied behind our back because our effort to lower demand is grossly underfunded, not as effective as it needs to be. The average person who is seeking serious substance abuse treatment in a big city, like Dallas or Chicago, typically has a three-, four-, six-month waiting list to get enrolled in a program. I think that's a problem and most law enforcement officials I think would agree that it is a problem.

Q Mr. President, I have a general question about your overall communication strategy as President. I mean, here we are on day 51, I think this is -- and I appreciate you talking to us regional reporters -- you've done outreach with bloggers, I think you've done outreach to columnists across the political spectrum. There's still a lot of fear out there about the economy, the stock market, people aren't buying cars, they're not buying homes.

Do you feel that you've done a good enough job so far in really laying out what the game plane is for your administration in tackling this financial mess that's pulled the rug out from under the economy?

PRESIDENT OBAMA: Well, you know, I think that we can always do a better job. Keep in mind it's only been two weeks since I gave a joint session speech to Congress, the day after which everybody said, boy, that was really clear, and, we have a clear sense of what's going on. You know, the reviews were pretty good. I recognize, I think, the degree of concern that people have.

We've been in office all of seven weeks so far. This is a crisis that was eight years in the making -- maybe longer in some, you know, certain aspects of it. The buck stops with me and we're responsible, but it's going to take some time. And the truth of the matter is that the American people I think understand that it's going to take some time. If you look at the public polling, they recognize it's going to take a while to dig ourselves out of the hole.

We passed the stimulus package and I've been talking almost every day about elements of the stimulus package, the recovery package that are going to be having an immediate impact in the various hometowns that you represent. I think Mayor Rybak, the day we signed it, talked about the 57 police officers that wouldn't be laid off as a consequence of the stimulus.

So I think people are getting the message that slowly, surely we are making progress on these fronts. We released a housing plan that is providing significant relief and you're already starting to see an uptick in refinancings that are providing families with relief. And in certain pockets of the country you're starting to see housing prices stabilize after a long drop.

You know, I think the one area where there's still significant uncertainty has to do with the bank issue. And that's obviously a particular concern to Wall Street. The challenge for us there is that we are in the process of undergoing -- or conducting these stress tests of the banks to get a better sense of what their capital positions are and how strong they are. And what we don't want to do is to prejudge those tests or make a lot of statements that cause a lot of nervousness around banks that are already having difficulty right now.

So on that particular issue, you know, we've got to I think explain to the American people -- and as I said, we can always to do better -- why it is so important to get lending going again, get credit flowing to businesses and consumers. I'll be making statements about this tomorrow, the next day, in my radio addresses, next week. And the main message that I'm going to be delivering is that it's going to take some time to get out of this deep hole we're in -- but we're going to get out of it.

The other message, though, is that there are no shortcuts to long-term economic growth and we can't just keep on doing the same things that we were doing before and somehow expect that all our problems are going to be solved. We've got to tackle some of these things like health care, energy, and education that have been put off for too long.

Q Thank you, Mr. President. I have a question about NASA, in honor of the Discovery launch tonight. Right now, the retirement of the space shuttle in 2010 is going to devastate the Space Coast economy down in Florida. You're looking at about 3,500 job losses, at the least, at the Center -- which will multiply to as many as 28,000 jobs throughout that entire area.

Right now, you reaffirmed President Bush's decision to retire the shuttle in 2010. I guess what I want to know is why you decided to keep that 2010 retirement date for the shuttle, and what type of plans you may have to try to save the Space Coast from an economic crater?

PRESIDENT OBAMA: Well, first of all, we've authorized, and we're budgeted for, additional shuttle launches that had not been scheduled. And so we're extending the life of the shuttle, because, A, I think it is doing some important work; and B, we're very mindful of the economic impact of the space program in the region.

I will soon be appointing a new NASA director. I think it's important for the long term vibrancy of our space program to think through what NASA's core mission is, and what the next great adventures and discoveries are under the NASA banner.

NASA has yielded -- or the space shuttle program has yielded some extraordinary scientific discoveries. But I think it's fair to say that there's been a sense of drift to our space program over the last several years. We need to restore that sense of excitement and interest that existed around the space program. And shaping a mission for NASA that is appropriate for the 21st century is going to be one of the biggest tasks of my new NASA director.

Once we have that vision, then I think it's going to be much easier to build support for expanding our space efforts. But what I don't want NASA to do is just sort of limp along here. And I don't think that's good for the economy of the region either.

Q Mr. President, in appointing a FEMA administrator last week, were you signaling your intention to keep the agency as part of the Department of Homeland Security? And now that you've sent some Cabinet members to New Orleans, might we expect your presence in the city, perhaps even for the new hurricane season?

PRESIDENT OBAMA: I'm just still trying to figure out my schedule for tomorrow -- (laughter) -- so I don't want to get too far ahead of myself. Sending Secretary Donovan and Napolitano signaled that we're going to be focused on New Orleans' reconstruction, and we're going to be paying a lot of attention to the systems that are in place to protect from hurricanes in the future.

And I -- what was the first question?

Q On FEMA, and whether FEMA stays within DHS.

PRESIDENT OBAMA: FEMA. I have not made a final decision on that. But whether FEMA stays inside DHS, or is once again a standalone agency, the one thing you can be certain of is that it's going to do an outstanding job performing its tasks. And I think that the new director has gotten uniformly high grades.

Whenever you got Haley Barbour, Jeb Bush, and Democrats in Congress agreeing on somebody, they know what they're doing.

Q Thanks, Mr. President. I wondered if, first, you could elaborate as a President from Chicago, a little bit on your own vision for high-speed rail in the Midwest -- particularly the idea of a Chicago-to-Milwaukee-to-Twin Cities link.

And then a completely unrelated political question: Whether you're at all surprised by the degree of, sort of, discipline and unity we're seeing in a Republican opposition to your agenda right now?

PRESIDENT OBAMA: Well, let me answer the political question first. I'm not surprised, because opposition is always easy; saying no to something is easy. Saying yes to something, and figuring out how to solve problems, and governing, that's hard. And on this budget debate, for example, if you've got people who on the one hand say, we want to bring down the long term deficit, but we don't want to cut certain programs that are important -- oh, and by the way, we don't want to raise taxes.

Well, sounds good. And I'd like to make sure that the Chicago Bulls win the championship every year and the White Sox win the series, but you know, show me how you're going to do it.

So I'm not impressed by just being able to say no. I think what will be interesting is the degree to which my Republican colleagues start putting forward in the form of an affirmative agenda that's not based on ideology, but on the very real struggles and pain that people are feeling right now around the country, and how do we get this economy back on its feet.

In terms of high-speed rail, I think there's enormous opportunities here. Now, I would have loved to have seen more done on high-speed rail in the recovery package, because I think it's the right direction for us to go in. I could not credibly claim that all of the investments that are necessary are short term enough to be in a recovery package, as opposed to be part of our broader transportation bills and budget.

But think about it. I mean, we've laid a transcontinental railway system during the Civil War. Railroads were always the pride of America, and stitched us together. Now Japan, China, all of Europe have high-speed rail systems that put ours to shame. And the potential economic benefits of a high-speed rail link between Chicago and Milwaukee, so that people are avoiding I-94, or the length between Chicago and St. Louis, Detroit, all those Midwestern cities, I think is enormous, and is a very real option with -- although gas prices are low right now, it becomes a very meaningful option for people who don't want to take off their shoes, drive to an airport, pay for parking, suffer delays. So I think there's a very real opportunity.

I should point out that the opportunities around the rail are not just in high-speed rail. I mean, there's some basic freight rail issues in Chicago, Milwaukee, the Midwest, that can also be solved, and would help with the whole distribution of goods in the region that would save business a lot of money. And I hope that we end up spending some time focused on that during the transportation reauthorization.

Last question, because I'm out of time.

Q Mr. President, thanks again for doing this. Given the worldwide context of the economic crisis you're dealing with, are the stimulus measures that you've championed in your mind sufficient to right the economy, absent similar actions by other large economies in the world?

And if I could just turn the question around in a way, there are estimates of, like, a hundred million have been plunged into poverty worldwide. Does the U.S., do you have any interest in their situation, whether from the standpoint of self-interest, national security, or morality?

PRESIDENT OBAMA: Well, it's a great question. I anticipated this question, even though I didn't know you were going to ask it, Jim, because Secretary Geithner is now headed off to the G20 finance minister's meeting as a precursor to our G20 meeting. And what we specifically talked about was, number one, our economic recovery is linked up to the economic recovery of the rest of the world, and vice versa. Up until a few months ago, exports were one of the few bright spots in our economy.

The collapse of worldwide demand costs American jobs and American businesses. And so we want to work with other countries to make sure that they're promoting the kinds of fiscal stimulus packages that can boost demand in their countries. It's important that we don't fall into a protectionist mentality so that each country, even as it's stimulating, is also still promoting the kinds of trade that can help us all grow.

And part of the G20 agenda is also thinking about the adverse impact that this global economic slowdown is having on the poorest of the poor. I think we have all of the above -- a moral, national security, and economic interest in making sure that people in those countries are not suffering even more than they were already suffering, because that can be profoundly destabilizing in all sorts of ways.

You know, there were a couple of questions about the border situation with Mexico. You know, if Mexico's economy can not provide a living wage of any sort to a growing Mexican population, that obviously is going to put more pressure on us in terms of immigration, more people being pushed into the drug trade, and so on.

And that's just one example. There are more severe examples of instability in places like North Africa in the face of drought or shortage of food supplies that can end up causing us real problems.

So figuring out how the developed countries, wealthier countries, even in the midst of hardship, can provide some relief and assistance to those countries, as well, I think is going to be very important.